Bovis Homes set for record FY revenues amid positive backdrop

The company said in a trading update that aside from the weeks immediately after the Brexit vote, sales in the year to date have followed a normal seasonal pattern and it is on track to achieve over 5% growth in legal completion volume in the year. Bovis said sales prices remain robust as it continues to sell homes at prices in line with its expectations.

The average sales price for this year is expected to be around 10% ahead of 2015, driven by improving mix and increased underlying market pricing. Meanwhile, the combination of increased volume and sales price growth should deliver an increase in revenue and capital turn for 2016, supporting a further improvement in return on capital employed.

Chief executive David Ritchie said: “Another year of both growth in volume and increase in average sales price is expected to deliver record revenues for the group in 2016. As a result, we are on track to deliver increased profit and a further improvement in return on capital employed, in line with our expectations.

“We continue to trade well, drive production across all our sites, invest in our people and acquire high quality land outside London. Housing market fundamentals remain supportive despite greater market uncertainty and we continue to manage the business through the cycle to deliver sustainable shareholder returns.”

Bovis said it continues to buy high quality consented land in prime locations outside London, with new sites being acquired at returns in line with its increased hurdle rates. The supply of land into the market remains good and the land market continues to reflect the current environment.

In the first half of this year, it bought 1,267 consented plots across 11 new sites and since then it has acquired or approved for acquisition a further 1,033 consented plots across nine sites.